AP govt decides to cut budgetary spending

The state's own revenues during this period grew 13.86% at Rs 12,881 cr

The Andhra Pradesh government has decided to impose a 20 per cent cut on the non-plan expenditure as the spending was seen more on this count in the second quarter ending September 2014.

A review of the trends on expenditure undertaken by finance minister Yanamala Ramakrishnudu showed that there was a 27 per cent jump in non-plan expenditure at Rs 12,700 crore in the same period last year. The total government expenditure during the second quarter witnessed a 20 per cent increase at Rs 17,500 crore, suggesting a reduced spending on the plan outlay.

The state's own revenues during this period grew 13.86 per cent at Rs 12,881 crore. Of this, the commercial tax collections grew 22.35 per cent to Rs 6,673.83 crore as compared with the same period last year, according to the officials.

The state government has proposed a budgetary spending of Rs 98,141 crore for the current financial year. Of this, an estimated Rs 78,976 crore was proposed under the non-plan. A 20 per cent cut on the total non-plan expenditure would work out at about Rs 15,795 crore.

In a statement, the finance minister clarified that there will not be any cut on spending like salaries, professional and contractual services, stipend and scholarships.

The state government has started taking the extra load of election promises such as raising the old-age pensions to Rs 1,000 from the present Rs 200, and the farm loan waiver only in the month of October. And, going by the current trend, this is expected to further strain the state finances.

Meanwhile, the finance department has asked all the departments to explore ways to raise additional resources keeping in view the spending commitments on hand.

"The minister instructed the officers of the finance department to ensure that the key fiscal parameters do not deteriorate by keeping the revenue expenditure under control," a statement issued by the finance minister's office said.

Meanwhile, chief minister N Chandrababu Naidu, who held a review meeting with the finance department officials on the resource mobilisation, asked them to explore the possibilities of setting up economic intelligence units on the lines of a similar initiative taken up by the Maharashtra Government while using advanced digital technologies.